Various retinal degenerative diseases including dry and neovascular age-related macular degeneration (AMD), retinitis pigmentosa, and diabetic retinopathy are associated with the degeneration of the retinal pigmented epithelial (RPE) layer of the retina. This consequently results in the death of rod and cone photoreceptors that they support, structurally and functionally leading to legal or complete blindness. Therefore, developing therapeutic strategies to preserve cellular homeostasis in the RPE would be a favorable asset in the clinic. The aryl hydrocarbon receptor (AhR) is a conserved, environmental ligand-dependent, per ARNT-sim (PAS) domain containing bHLH transcription factor that mediates adaptive response to stress via its downstream transcriptional targets. Using in silico, in vitro and in vivo assays, we identified 2,2'-aminophenyl indole (2AI) as a potent synthetic ligand of AhR that protects RPE cells in vitro from lipid peroxidation cytotoxicity mediated by 4-hydroxynonenal (4HNE) as well as the retina in vivo from light-damage. Additionally, metabolic characterization of this molecule by LC-MS suggests that 2AI alters the lipid metabolism of RPE cells, enhancing the intracellular levels of palmitoleic acid. Finally, we show that, as a downstream effector of 2AI-mediated AhR activation, palmitoleic acid protects RPE cells from 4HNE-mediated stress, and light mediated retinal degeneration in mice.